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Minibus taxi fares to increase amid looming fuel price hike

Minibus taxis, mostly Toyota-made, at Baragwanath, the biggest taxi rank in Soweto. Protest action will continue.Photo: Reuters

Minibus taxis, mostly Toyota-made, at Baragwanath, the biggest taxi rank in Soweto. Protest action will continue.Photo: Reuters

Published May 18, 2022

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Pretoria - There's a great chance that South Africans might be facing one of the biggest petrol increases in June if no further interventions are announced by the government.

This new development might also lead to minibus taxi fare increases, while e-hailing operators fear a further fuel increase will put added pressure on the profit margins in that industry.

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According to the Automobile Association’s (AA) mid-month unaudited data predicts fuel price increases of between R1.93 and R1.97 per litre while diesel is set to increase by between R1.60 and R1.62, and illuminated paraffin by R2.14.

In late March, the government reduced the general fuel levy by R1.50 for April and May, which brought temporary relief to motorists.

However, the R1.50 “tax holiday” is set to expire at the end of May, and there is growing concern that it won't be extended, leaving cash-strapped South Africans with another headache amid rising costs in food and other services.

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Santaco’s chief strategic manager, Bafana Magagula said the minibus taxi industry had no choice but to increase fares should the price of fuel continue to break record prices as it has in recent months.

"To be very honest with everyone, I think if South African are honest to the situation, they will understand that the taxi industry has taken a knock for too long now and it's unable to continue taking the knock.

"It is now imminent that taxis will increase, at the moment we can't say by how much, but definitely all commuters need to expect a taxi hike. If we don't do this, there will be no taxi business left," Magagula said.

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On the e-hailing front, the national spokesperson for the e-hailing industry, Vhatuka Mbelengwa, said the mooted fuel price increase was bad news for the industry.

"This will also impact tourism, restaurants, even the cost of bread for the poorest of the poor will be affected.

"Society needs to challenge the government on all these levies added to fuel cost and should demand for drastic reduction on fuel costs," he said.

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Earlier this year, the Minister of Finance Enoch Godongwana announced various permanent adjustments to the fuel price calculation that would take effect from June, including a cap on the price of 93 Unleaded petrol.

However, it remains to be seen whether this will provide any buffer against rising international oil prices and a weak rand.

The AA has urged the government to find and announce a long-term solution sooner rather than later.

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